Massachusetts Health Reform

Solving the Long-Run Cost Problem

Since its inception in 2006, many of Massachusetts’s health reforms have brought about positive change: the number of uninsured has fallen by half, access to needed care has increased, and private insurance has not been “crowded out” by public insurance programs. But the Massachusetts initiative has also seen higher than anticipated costs.

In a new analysis by the Urban Institute, researchers John Holahan and Linda Blumberg summarize the state’s accomplishments, examine the challenges, and suggest four options for addressing long-term costs.

According to the authors, much of Massachusetts’s high spend­ing growth is due to the concentration in the state’s hospital and insurance markets. Its per capita health care spending is higher than the national average and—with the market dominated by a small number of insurers as well as consolidated, high-cost academic medical centers—engendering market competition has proven difficult.